1. Integrated Marketing Communication Strategy and Management
Chapter 6
Integrated Marketing Communication Strategy and Management

2. In this chapter, you will learn about…
Integrated Marketing Communication (IMC) Strategy Framework
Information Requirements in Purchase Decisions
Reasonable Communication Objectives
Developing an IMC Mix
Information Requirements of Buyers
Nature of the Offering
Target-Market Characteristics
Organizational Capacity
Push versus Pull Communication Strategies

3. In this chapter, you will learn about…
Marketing Web Sites and Integrated Marketing Communications
Purpose of Marketing Web Sites
Leveraging Advertising and Personal Selling with Promotional Web Sites
Communication Mix Budgeting
Communication Budget Allocation
Evaluation and Control of the Communication Process

4. What is Marketing Communication?
Marketing communication is the process by which information about an organization and its offerings is disseminated to selected markets.

5. Goal of Marketing Communication
Induce initial purchase
Create post purchase satisfaction

6. Purpose of Marketing Communication
Communication is necessary to inform buyers of the following:
The availability of an offering
The unique benefits of the offering
The where and how of obtaining and using the offering

7. Marketing Communication Mix
Advertising
Personal
Selling
Communications
Mix
Sales
Promotion

8. Integrated Marketing Communications (IMC)
The practice of blending different elements of the communication mix in mutually reinforcing ways.

9. IMC Strategy Framework
What are the information requirements of target markets?
What are the objectives of the strategy?
Can some of the communication activities be combined?
What should the budget be and how should resources be allocated?
How should it be timed and scheduled?
How should it be evaluated?

10. Information Requirements in Purchase Decisions Purchase Process Model
Unawareness
Knowledge
Preference
Purchase

11. Information Requirements in Purchase Decisions
Determine how buyers purchase a particular offering
Roles played by individuals in the buying center/household
Define the role of information in the purchase process
When, where, how, and what information is used for decision making
Determine the perception that consumers have of the organization and the offering
Sources from which information is sought

12. Reasonable Communication Objectives
Objectives differ depending on stage in product life-cycle:
Build primary demand
Demand for the product or service class
Build selective demand
Demand for a particular brand, product, or service

13. Reasonable Communication Objectives Requirements
Consistent
Both among themselves and with other marketing elements
Quantifiable
For measurement and control purposes
Attainable
With an appropriate amount of effort and expenditure and within a specific time frame

14. Developing an IMC Mix Factors to be Considered
The information requirements of potential buyers
The nature of the offering
The nature of the target market
The capacity of the organization

15. Developing an IMC Mix Information Requirements of Buyers
Analyze the relative value of the communication tools used at various stages in the purchase-decision process
Advertising creates awareness
Salespeople provide information
Sales promotion, brochures, and catalogs provide descriptions and stimulate trial

16. Developing an IMC Mix Nature of the Offering
Advertising is useful when an offering is not complex, is frequently purchased, is relatively inexpensive, or has benefits that differentiate it from competition
Personal selling is required when a product is relatively expensive or its benefits are not readily apparent
Sales promotion lends itself to nearly every offering type because of the wide variety of forms it can assume

17. Developing an IMC Mix Target Market Characteristics
Advertising is effective for communicating an offering to a mass market that is geographically scattered
Direct marketing (e.g., Internet) can also be used to reach a geographically dispersed target market
Personal selling is useful when a small number of buyers live in close proximity and purchase large quantities

18. Developing an IMC Mix Organizational Capacity
vs.
MAKE
BUY
Perform the activity internally?
Company sales force
Fixed and variable costs
More control
Flexibility
Focused sales effort
Greater availability
Contract it out?
Independent sales representatives
Variable costs only
Acceptable control
Lower personnel costs
Greater flexibility
Increased sales effort

19. Developing an IMC Mix Organizational Capacity
Commission paid to independent reps = 5%
Commission paid to company salespeople = 3%
Salary and admin costs for salespeople = $500,000
At what level X of sales would both options cost the same?
Cost of company reps
0.03X + $500,000
Cost of independent reps
0.05X =
Solving for X, we get $25 million for the level of sales at which both options will cost the same.

20. Independent Reps Selling Cost Company Sales Force Selling Cost
Break-Even Chart for Comparing Independent Reps and Company Sales Force
Company Sales Cost ($000)
Independent Reps Selling Cost
$3,000
$2,500
$2,000
($1,250)
Company Sales Force Selling Cost
$1,000
$500 5 10 15 20 25 30 35 40
Company Sales
($ Millions)

21. Developing an IMC Mix Push and Pull Strategies
Producer
Retailers and
Wholesalers
Consumers
PUSH strategy
Retailers and
Wholesalers
Consumers
PULL strategy

22. Developing an IMC Mix Push and Pull Strategies
Push strategy is typically used when…
An organization has easily identifiable buyers
The offering is complex
Buyers view the purchase as being risky
A product or service is early in its life cycle
The organization has limited funds for direct-to-consumer advertising

23. Developing an IMC Mix Identifying an Advertising Opportunity
There is a favorable primary demand for a product or service category
The product or service to be advertised can be significantly differentiated from its competitors
The product or service has hidden qualities or benefits that can be communicated through advertising
There are strong emotional buying motives involved, such as for health, beauty, or safety

24. Marketing Web Sites and IMC
Transactional Sites
Focus on turning an online browser into an online buyer. Successful transactional Web sites feature:
Well-known, branded products and services
Favorable shopping and buying experiences (e.g., Gap.com)

25. Marketing Web Sites and IMC
Promotional Sites
Promote a company’s products and services and provide information on how items can be used and where they can be purchased
Can have games, contests, quizzes with electronic coupons and other gifts and prizes (e.g., Saturn.com)

26. Marketing Web Sites and IMC
Promotional Sites
Can also be used to create a buzz (word of mouth behavior)

27. Marketing Web Sites and IMC
Viral Sites
Encourages individuals to forward marketer-initiated messages to others via
Procter & Gamble’s Physique shampoo
People who referred 10 friends to the shampoo’s promotional web site received a gift
The promotion generated 2 million referrals!

28. Leveraging Advertising and Personal Selling with Promotion Web Site
Promotional Web sites and the Internet/Web-enabled technology that supports them can leverage advertising and personal selling efforts
Can play a cost-effective role in:
Communication mix
Early stages of the process-need recognition
Development of product specifications
Providing feedback on product/service performance

29. Communication Mix Budgeting
Make the budget commensurate with the tasks required of the communication activities
Establishing the size of a communication budget:
Formula-based guidelines
Qualitatively-based guidelines

30. Communication Mix Budgeting Formula-based Approaches
Percentage of sales approach
Past sales or anticipated sales can be used for this approach
Per unit method
Multiply per unit spending with expected sales volume
Mostly used by durable-goods manufacturers (e.g., appliance marketers)

31. Communication Mix Budgeting Qualitatively-based Approaches
Competitive-party approach
Maintain a parity between company’s communication expenditures and those of its competitors
All available funds
When introducing a new offering

32. Communication Mix Budgeting
Objective-task approach
Define the communication objectives
Identify the tasks needed to attain the objectives
Estimate the costs associated with the performance of these tasks
This method is typically considered the best approach.

33. Communication Mix Budgeting Advertising Budget Allocation
SIX media:
Television
Radio
Magazine
Newspaper
Billboard
Internet
Each medium consists of vehicles that have specific characteristics

34. Communication Mix Budgeting Advertising Budget Allocation
Media are mostly chosen based on:
Cost
Reach
Frequency
Audience characteristics
Other considerations:
Purpose of the advertisement
Product needs
Editorial climate

35. Communication Mix Budgeting Sales Force Budget Allocation
NC x FC x LC TA
NS =
NS = number of sales people
NC = number of customers (actual or potential)
FC = necessary frequency of customer calls
LC = length of average customer call, including travel time
TA = average available selling time per salesperson (less administrative time)

36. Communication Mix Budgeting
Sales Force Budget Allocation Example
No. of potential customers = 2500
No. of calls per customers per year = 4
Travel time per call = 2 hrs
Number of working hours per year = 1340
2500 x 4 x 2
1340
= 15 salespeople needed

37. Evaluation and Control of the Communication Process
Continuous monitoring of the execution of any communication to ensure that communication objectives are being attained
Should incorporate some measure of sales or profits
Budgeting